CASWELL BELL & HILLISON LLP
FRESNO, CALIFORNIA

THERE IS NO SUCH THING AS “BINDING MEDIATION”

In recent years, various forms of alternative dispute resolution (ADR) have been promoted as an alternative to trial.  Some contracts – notably, the forms developed by the California Association of Realtors – provide a strong incentive for attempting ADR before filing a lawsuit.  Under the CAR forms, attorneys fees will be denied to a litigant unless that party participated in ADR before resorting to litigation.

Mediation and arbitration are two different types of ADR.  In mediation, the parties try to resolve their differences by mutual agreement; the mediator works with the parties, but does not have the power to make binding orders against any party.

In contrast, an arbitrator generally has the power to make binding decisions.  While arbitration does not involve a formal trial, the decision of the arbitrator can be enforced just like a judgment.

Mediation is Different From Arbitration

Enter a new animal: “binding mediation.”  Just what is this form of ADR?  According to the recent decision in Lindsay v. Lewandowski (May 30, 2006), it is a term unknown to the law, and not subject to judicial enforcement.

Presiding Justice David G. Sills was eloquent in his concurrence, which is set out at length below.  His thoughts ring true, and should be considered both by attorneys and their clients.

Says Justice Sills, “I fully concur in the lead opinion but write separately because the term ‘binding mediation’ is relatively new in the legal lexicon and because it is a deceptive and misleading term . . .

“I also write separately to more clearly register the oxymoronic character of the concept of ‘binding mediation.’  As lawyers we should use precise language – that is our tradition.  A fuzz PR phrase like ‘binding mediation’ is not worthy of us . . .

“A private decision maker with ‘binding’ power is called an arbitrator.  A private decision maker who simply tries to have parties come to some voluntary agreement is a mediator.  A mediator with binding power is an arbitrator, not a mediator . . .

“I can think of nothing more self-contradictory than ‘binding mediation.’  Mediation is by definition a voluntary process which achieves a voluntary result, and is meaningful in distinction to ‘arbitration’ in its very voluntariness.  Or, to put it with more bite – mediation is distinctive from arbitration in its inherent lack of consequences.  You go to mediation, you like it, you don't, you settle, you don't, no big deal . . .

ADR is All About “Private Judging”

“Unfortunately, the term ‘binding mediation’ has come into existence because the Madison Avenue and MBA types have taken over what we once called ‘private judging.’  Now we call it ‘alternative dispute resolution’ because that is a softer and gentler term and implies that the parties will have their disputes resolved in a way that is mutually satisfactory; not that they will receive a decision from a judge which one of the parties will not like. 

“‘Private judging’ implies a quasi trial process with all of the tension of a courtroom and the acrimony of litigation.  Although, ‘alternative dispute resolution’ is virtually the same thing, it sounds softer.  Likewise, ‘settlement conference’ is also a forbidden term.  The public relations people like ‘mediation’ because mediation implies that your matter or dispute will be resolved to your satisfaction. 

“The term ‘settlement conference’ sounds like a committee meeting where people get together and talk about a settlement, but nothing might happen.  That of course is unacceptable after the parties have spent a lot of money to schedule the meeting.  Another term that the public relations people don't like is ‘arbitration,’ because arbitration implies that a decision will be made and not necessarily a decision one or both of the parties may like. 

“Hence, ‘binding mediation’ has come into existence because it is kinder and gentler.  But as this case demonstrates, it is half-baked arbitration.”

© Caswell Bell & Hillison LLP          Attorneys and Lawyers, Fresno, California